Harland to Acquire Liberty Enterprises, Inc. for $160 million

ATLANTA – John H. Harland Company (NYSE: JH) has signed a definitive agreement to acquire Liberty Enterprises, Inc., the two companies announced today.

Headquartered in Mounds View, Minnesota, Liberty is a provider of checks, marketing services, education and e-commerce solutions primarily to credit unions. Liberty includes Liberty Essentials, which provides checks and forms; MyDAS Marketing, which provides training and education; ALTAFI, a strategic marketing and creative company; and Cavion Plus, a developer of secure Internet financial products and services. Liberty had revenue of $135 million in 2004, of which approximately 75% was from the sale of checks and forms.

Harland will pay $160 million in a cash-for-stock purchase under a 338(h)(10) tax election. Harland expects the acquisition to be immediately accretive to earnings, with an estimated impact to earnings of $0.10 – $0.15 per share over the first full year, with the majority of the increase occurring in the latter part of the first 12 months. Once fully integrated, the acquisition is expected to contribute an estimated $0.25 to $0.30 in annual earnings per share. The acquisition is subject to regulatory approval and other closing conditions, and is expected to close in late May or early June.

“There is a complementary fit between Harland and Liberty that demonstrates our commitment to credit unions,” said Timothy C. Tuff, chairman and chief executive officer of Harland. “Both Harland and Liberty have expanded their core check printing offerings to include other products and services that add value for their customers.”

Tuff added that Liberty’s position primarily in smaller and mid-sized credit unions complements Harland’s position among the larger credit unions and that the combined range of products and services will make Harland the preferred partner for credit unions across the country.

“We are excited to become part of Harland,” said Stan Hollen, president and chief executive officer of Liberty. “Both companies share a commitment to providing strategic products and services to their customers. Liberty’s customers will benefit from the extensive product offerings of Harland. In addition, there is a good cultural fit between the two organizations. This agreement will enable both organizations to increase the value we offer to our customers.”